Expelled Church Members Sue Church, Directors and Officers

Key point. According to the minority view, the civil courts may engage in "marginal review" of disputes involving the discipline of a church member, in a few limited circumstances if they can do so without inquiring into religious doctrine or polity. For example, a few courts have been willing to review membership dismissals in one or more of the following limited circumstances: (1) the church interfered with a member's civil, contract, or property rights; (2) the disciplining body lacked authority to act; (3) the church failed to comply with its governing documents; (4) the church's decision was based on fraud or collusion; or (5) interpretation of contested terminology in the church's governing documents.

A Hawaii court ruled that it was not barred by the First Amendment from resolving a complaint by several expelled church members challenging the legality of their expulsion.

A group of church members (the "plaintiffs") sued their church, and its directors and officers, alleging that the church was operated for profit, and that church funds and assets had been misused for the pastor's personal benefit. They also asked the court to recognize their legal right, under the state nonprofit corporation law, to inspect the church's financial records. The plaintiffs' lawsuit contained the following allegations:

The church was a nonprofit corporation that had been granted a charter of incorporation by the state on the condition that it was "not organized for profit, that no part of [the church's] assets, income, or earnings shall be withdrawn or distributed to any of its members, and that officers, employees, or members of [the church] would not be paid for services that were not rendered or to be rendered to [the church]."

• The church paid for various properties being used by the pastor and his family members as personal residences.
• During a two year period the pastor and his family had been paid nearly $500,000 in compensation and benefits by the church.
• The church authorized the pastor and members of his family to lease expensive automobiles.
• The church breached its fiduciary duties, obtained secret profits, wasted corporate assets, jeopardized its tax-exempt status, and conducted a faulty election of the church's directors in violation of the church bylaws.
• There existed various other accounting discrepancies and financial irregularities pertaining to the governance of the church.

Following the filing of the lawsuit, the church expelled 156 of its members, including the plaintiffs. The church then asked the court to dismiss the lawsuit on the ground that the plaintiffs were no longer members and therefore lacked standing. The church also insisted that under the so-called "ecclesiastical abstention doctrine" the court had no jurisdiction to resolve what amounted to an internal church dispute.

The plaintiffs asserted that by incorporating under the state nonprofit corporation law the church voluntarily submitted itself to the jurisdiction of the civil courts; and, that because the church's act of expelling them from the congregation was not "fair and reasonable" as required by the nonprofit corporation law and violated the Church's own bylaws, they had standing to bring their lawsuit. Further, they claimed that since they were never lawfully expelled from the church, they were still members and had the right to under the state nonprofit corporation law to inspect the church's financial records.

The plaintiffs claimed that the ecclesiastical abstention doctrine did not prevent the court from resolving their claims since (1) they were alleging "secular causes of action and not non-reviewable matters of church polity or doctrine"; and (2) a determination that the church violated its bylaws, and state law, in expelling the 156 members would not require the court to make "any constitutionally prohibited inquiry into doctrinal matters or religious law."

The appeals court began its opinion by noting that it had to decide "whether the expelled church members can use the Hawaii Nonprofit Corporations Act as a vehicle for enforcement of the church's bylaws despite the constitutional doctrine of ecclesiastical abstention." The court concluded that the ecclesiastical abstention doctrine did not prevent it from resolving the plaintiffs' wrongful expulsion claim, or from recognizing their legal right to inspect church records.

The court made a distinction between hierarchical and congregational churches. Hierarchical churches have their own established rules for discipline and internal government, and tribunals "tied to and based on ecclesiastical law developed over long periods of time …. To delve into the decision-making processes of these bodies would entangle a court into the religious thicket."

But, in a congregational church there is no body of ecclesiastical law to invoke, no internal tribunal to appeal to. A member of a congregational church, seeking the aid of the court in protecting his civil and property rights, may appeal only to the simple and fundamental principles of democratic government which are universally accepted in our society. These principles include the right to reasonable notice, the right to attend and advocate one's views, and the right to an honest count of the votes.

Such rights are fundamental to our notions of due process. They are neutral principles of law, applicable not only to religious bodies, but to public and private lay organizations and to civil governments as well. Courts must apply them every day, and can do so without any danger of entering a religious thicket. Therefore, the authorities which preclude the courts from examining whether an hierarchical church correctly followed its own internal procedures, or correctly applied its canon law, are inapposite to the question before us.

Similarly, the ecclesiastical abstention doctrine did not prevent the court from enforcing the plaintiffs' right, under the state nonprofit corporation law, to inspect the church's financial records since such a decision "would not involve any religious or ecclesiastical matter." Baldonado v. Way of Salvation Church, 185 P.3d 913 (Hawaii App. 2008).